Hi friends! Welcome to this analysis of the four hour BTC chart. Let's jump right in. Looking at the chart, we can see that Bitcoin has just confirmed the 50% retrace as overhead resistance, and is now heading lower. If you recall, this is exactly what I said was likely to happen, a few BTC posts ago. We can see that BTC broke below the critical 50% retrace, formed a bear flag, and traded right back up into the resistance level. BTC was able to get above the 50 EMA (in orange,) only to test the heavy resistance level and quickly retreat. So, what is this telling us? It's telling us that the 50% retrace once acted as support, then BTC broke that support, and then later, confirmed it as resistance. Moves like this are continuation patterns. Do you remember my "Dead Cat Bounce" post from a few days ago? I basically told you that this would happen, and that BTC was likely forming a dead cat bounce. Since the DCB is a continuation pattern, we can expect it to continue. That means the pattern should now form a lower low, which would send BTC below the low made on the 17th. Oh look, that's perfectly inline with my bear flag target on the bottom of the chart. Huh. Funny how those things work. Anyway, we can see that the MACD is crossing over bearish, and is back below the zero line, which is a short-term sell signal. All-in-all, the ceiling has been defined, and it's not to far above us. The floor, on the other hand, is much much lower.
This has been your not-so-humble market wizard, droppin' knowledge like bombs in this place! Please follow, comment, like, and share on social media. Good luck trading everyone!
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
Excellent analysis, I totally share this bearish view of the current market conditions.
Besides, historically, each time BTC went parabolic and soffers a retracement over 30-40%, it didn't recover (at least for a while), and it eventually went all the way down to the hard rock bottom.
I've decided to stay liquid until the market condition takes a clear trend.
I don't want to sound too alarming or pessimistic, but since we are traders here... our "job" is to try to predict where price might be headed, and being bullishly biased all the time could be a recipe for disaster.
28carslater
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@Tradetech, Excellent post. Not professional but have studied charts on and off for several years and as I preach to my n00b friends, don't argue with the tape.
Wolverinos
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Why the ret of the TOP traders (besides Alanmasters) say exact the opposite, they all say it's a buy opportunity now ?
That Excavo guy says the resitance is at 12000 or something and we broke it... correction over.. ?
But I have seen that Poop was right almost every time...
Commodore3
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@Wolverinos, Yeah, he's got some really valuable poop :)
@Wolverinos, I might have a stupid question, but I trade on a site against the USD as well, and you buy positions like CFD's... I have some positions in red but everyone says better not to close... possible because it will be difficult to get back to original value again, or nothing to do ? just close in red and open lower?
Commodore3
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@Wolverinos, if you're not using margin trading, don't close
Commodore3
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@Wolverinos, another option. If you're sure you can get it cheaper, close and buy lower
Besides, historically, each time BTC went parabolic and soffers a retracement over 30-40%, it didn't recover (at least for a while), and it eventually went all the way down to the hard rock bottom.
I've decided to stay liquid until the market condition takes a clear trend.
I don't want to sound too alarming or pessimistic, but since we are traders here... our "job" is to try to predict where price might be headed, and being bullishly biased all the time could be a recipe for disaster.